(1) Does the 1995-96 annual report of the Australian National Railways
Commission (ANRC) record a loss of $116 265 000 as a write down of fixed
assets to their recoverable amount; if so, (a) what were those assets, (b)
what was their previous recorded value and (c) what is their current
value.
(2) Did he state that there was $580m of unfunded superannuation
liabilities for ANRC; if so, (a) to which superannuation schemes do the
liabilities refer, (b) what sums are involved, (c) what superannuation
payments were made to the Commonwealth by ANRC in (i) 1993-94, (ii) 1994-95
and (iii) 1995-96 and into which schemes were those payments made and (d) were
payments made into consolidated revenue.
(3) Did he also state that ANRC had $90m of unfunded provisions for
employee leave entitlements and workers' compensation; if so, (a) to which
entitlements does he refer, (b) what sums are involved, (c) in which financial
years did the entitlements accrue, (d) do leave entitlements refer to service
prior to the creation of ANRC, (e) for what sum in unfunded workers'
compensation liabilities has the Government assumed responsibility, (f) are
all the liabilities precisely defined or are they based on actuarial estimates
of life expectancy of current recipients of payments; if so, in what
proportion, (g) what proportion of the total sum relates to liability for
accident make-up pay rather than liability under workers' compensation
legislation, (h) in which financial years did the unfunded liabilities accrue
and (i) do liabilities refer to injuries received prior to the creation of
ANRC.
(4) Did he also state that ANRC needed $125.7m to provide for
outstanding contracts and other commitments; if so, (a) to which contracts and
commitments does he refer, (b) what sums are involved in each case and (c) are
the sums net of revenues due to ANRC under those contracts and
commitments.
(5) Did he refer to $779.4m for acquisition of Australian National's
(AN) debt at book value and the market value being higher; if so, by what sum
does the Government estimate the market value to be higher than the book
value.
(6) Did he also state that ANRC needed $50m for environmental costs; if
so, what are the details and what individual sums are involved.
(7) Which persons affected by the sale of AN will be eligible for
assistance from the $20m regional assistance package.
(8) Will rural NSW communities affected by modifications to, or the
closure of, the Indian Pacific be eligible for the assistance referred to in
part (7).
(9) Will the Government provide funding for community service
obligations to ensure the continued viability of existing AN services; if so,
(a) which services and (b) what sums will be provided.
(10) Based on a comparison of the financial years since 1990-91, to what
extent has the total public deficit in interstate rail freight decreased since
the establishment of the National Rail Corporation.
Mr Sharp--The answer to the honourable member's question is as
follows:
(1) Yes.
(a) to (c)
[TABLE OMITTED FROM DATABASE BUT IS AVAILABLE ON THE INTERNET, THE
PARLIAMENTARY INTRANET OR HARD COPY PAGE 3723]
(2) Yes. The Commonwealth required AN to fund fully, on an annual cash
basis, its obligations under these schemes and payments for the funds were
made into consolidated revenue. Therefore AN has no superannuation liability
for the schemes and the funding liability rests with the Commonwealth.
(a) & (b) The figure related to members of the Commonwealth
Superannuation Scheme (CSS), the Public Sector Superannuation Scheme (PSS),
the South Australian Superannuation Fund (SASS), and the Retirement Benefits
Fund of Tasmania (RBF) and was an aggregate estimate based on the assumption
that AN would be sold by the end of 1996/97 and that all staff would receive
lump sum benefits.
(c) Employer contributions for CSS; PSS, SASS; and RBF are all paid to
the Department of Finance. AN contributions amounted to:
[TABLE OMITTED FROM DATABASE BUT IS AVAILABLE ON THE INTERNET, THE
PARLIAMENTARY INTRANET OR HARD COPY PAGE 3723]
Source: AN Annual Reports
(d) Yes.
(3) Yes.
(a) AN has advised that the unfunded provisions relate to recreation
leave, long service leave, general insurance claims and workers'
compensation.
(b) As at 30 June 1996, these were estimated at $72.4m. Based on the
expense incurred in 1995/96, it was estimated that around $90m would be
required to fund these provisions by the end of 1996/97.
(c) AN has advised that the vast majority of recreation leave
entitlements will have accrued only over the past two years, while long
service leave entitlements may have accrued over a period of up to 30 or more
years. Settlements for general insurance relate mainly to claims made in
recent years. Workers' compensation entitlements represent claims which arose
before July 1989, when Comcare provisions came into effect. Such claims are
therefore many years old.
(d) AN has advised that for annual leave the answer is no. For long
service leave and workers' compensation the answer is, in regard to some
employees, yes.
(e) AN is unaware of any unfunded workers' compensation liabilities for
which the Government has assumed responsibility.
(f) Liabilities for annual leave and long service leave are precisely
defined, liabilities for general insurance are based on the expected cost of
the claim and liabilities for workers' compensation are based on actuarial
estimates.
(g) The outstanding provision for workers' compensation relates to AN's
liabilities before Comcare began in 1989 and mostly to people no longer
employed by AN. As a result, there is very little make-up pay included. Since
1989, AN has insured through Comcare and no AN provisions are required.
(h) See the answer to (c) above.
(i) In a small number of cases, yes.
(4) Yes.
(a), (b) and (c) The information sought is commercial-in-confidence and
is expected to be subject to negotiation.
(5) The market value of the debt is a function of the level of interest
rates (and, in the case of foreign currency denominated debt, also exchange
rates). The market value of the AN debt to be assumed by the Commonwealth will
be assessed as at the effective date of assumption by the Commonwealth and
will depend on the level of interest and exchange rates on that date. Given
the volatility of interest and exchange rates, it is not possible to
accurately forecast the likely market value of the AN debt at the time of the
assumption by the Commonwealth, but on present indications market value is
likely to be higher than book value.
(6) Yes. $3m of this amount will be used for the remediation of land
near the Islington workshops in Adelaide. The remainder of the funds will be
used for work elsewhere on land currently owned by AN.
(7) No individual will be eligible for assistance under the Rail Reform
Transition Program (RRTP). Persons made redundant by the sale will be eligible
for programs run by the Department of Employment, Education, Training and
Youth Affairs.
The objective of the RRTP is to support measures which create enduring
jobs through economic development of the regions most adversely affected.
(8) The Government has no plans to close the Indian Pacific or to change
its route.
(9) Private sector involvement is expected to lower the cost of
transport to industry and better meet the needs of customers. As a result,
some AN operations which now require a subsidy could become profitable.
The Government's objective in providing concessional travel to certain
groups is to assist the most needy. It is not known yet what the fare
structure would be once the AN passenger services are sold, as this would
primarily be a matter for the new owner. The Government will nevertheless
ensure that the concerns of the disadvantaged are taken into account and the
needs of those now entitled to concessional travel will be considered
sympathetically.
If AN's passenger business is not sold, the Government will consider
other options for the services.
(10) The National Rail Freight Initiative Committee estimated the annual
interstate rail freight deficit at around $375m in 1990/91. Due to the
transitional provisions in the NR Shareholders' Agreement which involve
quarantining of some losses to AN and the NSW and Victorian rail authorities,
it is not possible to estimate current losses precisely. It is likely that
these losses approached $100m in 1995/96.
[end quote]
--
Arthur Marsh, telephone +61-8-8370-2365, fax +61-8-8223-5082
arthur@dircsa.org.au
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